Critical Survey: United Community Bancorp (UCBA) and BankUnited (NYSE:BKU)

BankUnited (NYSE:BKU) and United Community Bancorp (NASDAQ:UCBA) are both finance companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, dividends, analyst recommendations, earnings, risk, valuation and institutional ownership.

Insider and Institutional Ownership

96.9% of BankUnited shares are held by institutional investors. Comparatively, 36.4% of United Community Bancorp shares are held by institutional investors. 1.7% of BankUnited shares are held by insiders. Comparatively, 9.7% of United Community Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

BankUnited pays an annual dividend of $0.84 per share and has a dividend yield of 2.5%. United Community Bancorp pays an annual dividend of $0.40 per share and has a dividend yield of 1.4%. BankUnited pays out 35.6% of its earnings in the form of a dividend. United Community Bancorp has raised its dividend for 2 consecutive years.

Profitability

This table compares BankUnited and United Community Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
BankUnited 19.06% 10.30% 0.97%
United Community Bancorp N/A N/A N/A

Earnings & Valuation

This table compares BankUnited and United Community Bancorp’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
BankUnited $1.58 billion 2.13 $324.87 million $2.36 14.50
United Community Bancorp N/A N/A N/A N/A N/A

BankUnited has higher revenue and earnings than United Community Bancorp.

Analyst Recommendations

This is a summary of recent recommendations for BankUnited and United Community Bancorp, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
BankUnited 1 5 2 0 2.13
United Community Bancorp 0 0 0 0 N/A

BankUnited currently has a consensus price target of $38.75, suggesting a potential upside of 13.20%. Given BankUnited’s higher probable upside, equities research analysts plainly believe BankUnited is more favorable than United Community Bancorp.

Summary

BankUnited beats United Community Bancorp on 8 of the 11 factors compared between the two stocks.

About BankUnited

BankUnited, Inc. operates as the bank holding company for BankUnited, National Association that provides a range of banking services to small and medium sized businesses, and individual and corporate customers in the United States. The company offers deposit products, such as checking, money market deposit, savings accounts, and certificates of deposit; and treasury management services. Its loans portfolio includes small business loans, commercial real estate loans, equipment loans and leases, term loans, formula-based loans, municipal and non-profit loans and leases, commercial and residential mortgage warehouse lines of credit, letters of credit, and consumer loans, as well as purchases performing residential loans. The company also offers ATMs, integrated online, mobile, and telephone banking services. As of December 31, 2018, it operated through a network of 85 branches located in 14 Florida counties; and 5 banking centers in the New York metropolitan area. The company was formerly known as BU Financial Corporation. BankUnited, Inc. is headquartered in Miami Lakes, Florida.

About United Community Bancorp

United Community Bancorp operates as the bank holding company for United Community Bank that provides various banking products and services to consumers and businesses in Southeastern Indiana. Its deposit products include noninterest-bearing demand accounts, including checking accounts; interest-bearing accounts, such as interest-bearing checking and money market accounts; regular savings accounts; and certificates of deposit, as well as municipal deposits. The company also provides one-to four-family residential real estate, multi-family real estate, nonresidential real estate and land, construction, agricultural, and commercial loans, as well as consumer loans comprising home equity loans and lines of credit, loans secured by savings accounts or certificates of deposit, new farm and garden equipment loans, new and used automobiles loans, recreational vehicle loans, and secured and unsecured personal loans. It operates through five branches located in Dearborn County and three branches located in adjacent Ripley County in Indiana. The company was founded in 1999 and is headquartered in Lawrenceburg, Indiana.

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